Bought High, Now Regret It? Here’s the Truth About Selling During Forbearance/ Short-Sale

“When the market cools but your mortgage doesn’t…”

If you’re in forbearance or falling behind on mortgage payments, the clock isn’t just ticking — it’s compounding. You might still have time to walk away clean, but in this market, time is not on your side.

Right now, homes in many price points are sitting anywhere from 4 to 6+ months, depending on location, condition, and pricing strategy. So let’s say you list your home for $650,000 and you currently owe $560,000. On the surface, that gives you some equity cushion. But here’s what most sellers overlook: once you hit the market, your monthly unpaid mortgage keeps stacking onto your balance.  If your mortgage is around $3,500/month, that number grows fast — and it eats away your equity while your home waits for a buyer.

Now let’s break it down with real numbers. At $650K, standard agent commissions (3% to each side) total $39,000. Add that to your current mortgage of $560K, and you’re already at $599,000. That leaves you around $51,000 in theoretical equity — before factoring in closing costs, title fees, and potential repairs or concessions, which could easily run another $6,000–$8,000. At best, you’re walking away with $40,000–$45,000, if the home sells quickly.

But what happens when it doesn’t?

Say it takes 4 months to get under contract. In that time, your unpaid mortgage adds up to $14,000 — pushing your total owed from $560K to $574,000. Add commissions on top? You’re now looking at $613,000 in total costs. Subtract that from your $650K asking price and you’re down to $37,000 — and that’s before closing costs.

One more month goes by? You’re sitting at $577,500 owed — and suddenly you're down to $33,500 or less. Equity vanishes fast. Wait too long, and you may not have enough left to cover commissions and closing costs — which means you’re no longer in control. Now you’re facing a short sale… or worse, foreclosure.

From Traditional Sale to Short Sale — It Can Happen Fast

At some point, if you're in forbearance or falling behind, you may reach a tipping point — where you can no longer afford to cover both closing costs and commissions.  When that happens, what started as a regular real estate transaction can turn into a short sale real quick.

Once the numbers stop working, we often have to drop the price to attract interest — and more importantly, to gain approval from the lender.  But here’s the surprise: once that price drops? It’s usually hard to keep buyers away. Short sales attract attention because buyers know they’re getting a deal.

But here’s what most sellers don’t know: You can’t even start a short sale without a contract.

The lender won’t review your file until there is an executed contract in hand. And even then, that executed contract isn’t final — not in the traditional sense.

Once a contract is submitted, the lender goes into review mode. They will negotiate. They will delay. They will re-evaluate. The bank is now in the driver’s seat — and they won’t approve anything until they’re satisfied with the bottom line.

From my experience, the appraisal becomes their internal benchmark. They won’t disclose it, but a seasoned Realtor can usually read between the lines. I’ve seen them negotiate down to within $5,000 of that appraised value, and once that target is hit — things move.

The key? Patience and strategy. The short sale process isn’t hard — it’s just different. It takes an agent who knows how to guide buyers, work with lenders, and stay on top of every moving part.

Bottom line?

If you’re nearing that financial tipping point, let’s talk before your options vanish.  Whether we walk away clean or navigate a short sale, I’ve been through it — and I know how to get you through it too.

Even if you are currently in forbearance or just falling behind, don’t wait. The sooner we list, the more options you have. You might still walk away clean — but the longer you wait, the faster that window closes.

📞 I’m Amanda Allen, and I’ll help you navigate this step by step. Let’s protect your equity before it’s gone.

Amanda Allen, Realtor

903-603-0648 |

amanda.allen@cbrealty.com

Proudly serving Rockwall, Kaufman, Collin, Hunt & Rains Counties & Surrounding areas

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